The New York Times finished a bright quarter for digital, as both online subscriptions and ad revenue rose.
Digital advertising rose the same amount that print declined, 11%, finishing at $42.3 million. However, since digital constitutes just over a quarter of advertising revenue, advertising declined overall by 5.8%.
Total revenue declined just 1.6% due to cost-cutting. Q1 revenues went down from $390 million to $348.2 million, enough to send the stock up 5% in the wake of earnings.
The Times added 47,000 digital subscribers for a total of 957,000, the strongest growth in two years. And it will likely see additional users (if not subscribers) as it moves the NYT Now app from low-cost to free. It made the app free to prioritize growth of the app over monetization of the app.
The publication sees a bright future as the industry embraces viewability. The newspaper is changing its website to improve viewable ad placements. “Viewability plays to The Times’ fundamental strength in engagement. In the long run, we expect viewability to help rather than hinder our advertising growth story,” Thompson said.
Mobile now makes up 10% of ad revenue, which CEO Mark Thompson and Meredith Kopit Levien, who was promoted to CRO last Thursday, attributed to a focus on better ad products optimized to a user’s experience. Mobile grew 40% year over year.
Paid Posts, The Times’ native advertising solution, will further contribute to mobile bottom lines. The Times hired more people to create Paid Posts, and it will expand the program internationally.
Programmatic ad revenue “grew nicely, mostly coming in the form of preferred and private deals, where we’re opening up specific demand pools” to advertisers, Kopit Levien described.
The Times’ video newfronts occurred earlier this week. Kopit Levien gave a reality check to investors curious about video prospects after the glitzy event.
“We’ve made progress in the quality of the production, and the quantity [of videos], and now the next question is to achieve substantial streamed growth,” Kopit Levien said. It will look to syndication to fuel some of that growth. The Times does some syndication; “[we] have aspirations of doing substantially more there. “
Two significant hires signal The New York Times’ focus on digital side. Kopit Levien’s promotion to CRO means she will oversee both The Times’ advertising and its marketing efforts to boost its subscriber base.
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At the end of March, it appointed Kinsey Wilson as its EVP of product and technology, where he will oversee The Times’ digital portfolio including mobile apps like NYT Now.
Despite the growth in digital, The Times still hasn’t reached a point where digital growth offsets print declines. In its guidance for the coming quarter, it expected mid-single digit declines in revenue year over year.
